A potato processing company in Rotherham has written off £1m debts after going into administration and being sold back to the managing director in a ‘pre-pack’ deal.
Boss David Pickles called in administrators after Holme Farm Produce in Goldthorpe failed to recover from a disastrous harvest two years ago in 2012 which saw the firm shed 20 jobs.
Despite attempts to turn the business around with a refinance and restructure, creditor pressure led him to call in administrators.
Peter O’Hara of Batley-based insolvency practitioners, O’Hara & Co, said the deal had saved 40 jobs and the future of the business.
He added: “It was the only option. We did a deal with secured creditors, including the banks, and got their approval for the pre-pack. The firm owed £1m to unsecured creditors.”
The family-run business, which has been trading since 1983, washes, grades and packs potatoes.
It moved to its current site in 2007 and has a £9m turnover.
In accounts for the year to March 31 2013, Holme Farm reported a 40 per cent increase in sales to £9.4m.
But profits were hit by contracts based on prices which could not be maintained due to the difficulties in obtaining supplies.
The UK potato harvest slumped to its lowest level for more than 30 years in 2012 after the country experienced some of the wettest weather in the past 100 years.
The firm’s website says, ‘We are a forward thinking company. We have commissioned the latest weight grading machines for potatoes from 40 mm to 140 mm in diameter
‘And the latest Newtec Celox Grader automates the inspection of the crop.’